When even Lord Tebbitt, Boris Johnson and a Conservative think tank are calling on Chancellor George Osborne to temper his proposed working tax credit cuts with compassion for the working poor, it is clear the old Tory world view has been shaken to its roots. Most Tories, and some from other parties, agree the tax credit scheme is in dire need of reform, but few, it appears, are prepared to see those in jobs penalised as result. Mr Osborne is being stalked, it seems, by his vainglorious claim that the Conservatives are now “the workers’ party”. And although nobody expected last night’s Westminster vote on welfare cuts to result in outright Tory rebellion, despite rumblings of discontent, the threat hangs over the Chancellor that his flint-hearted proposals could be defeated next week in the House of Lords, and limp back to the Commons in tatters, and disgrace.
Were the mooted cuts to be implemented 350,000 Scottish families (and three million in total across the UK) could find themselves up to £1300 a year worse off. It is this newspaper’s belief that even though the over-complicated tax credit system needs to be simplified, and eventually discarded, this cannot happen until employers are legally obliged to pay their staff a sustainable wage. Since the Tory promise of a living wage of over £9 an hour will not come into force until 2020, there is a frighteningly long wait between the loss of support and dignified self-sufficiency.
Nobody thinks that paying welfare to those in work is desirable; the ideal would be a workplace that offers decent remuneration. When that day comes, Britain will be healthier and more prosperous by every measure. That time is far off, however. Indeed, some economists have predicted that we are on the cusp of another recession. Since the tax credit cut is premised on a buoyant and rising economy, were they to be proved right, the risks in removing such welfare are alarming. Rather than take an axe to essential financial aid for many working families, the Chancellor would do better to make the tax credit system more streamlined and comprehensible. Only when a decent day’s wage is guaranteed for all should it be allowed to slip quietly off its books.
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